Hitachi wins contract for UK inter-city trains

[July 25, 2012]  TOKYO (AP) -- Japanese machinery maker Hitachi won a 4.5 billion pound ($7 billion) deal with the British government to build and maintain trains that will connect London with other cities, a project that will create more than 900 jobs.

The British Department for Transport said Wednesday that Hitachi, which secured the contract through a consortium it leads called Agility Trains, will set up a new factory in Newton Aycliffe, County Durham, to build 596 railway carriages.

Hitachi said the factory construction will create 200 jobs, and the plant will employ up to 730 people. The plant is expected to be running by 2015.

The first trains for the "Intercity Express Programme," which will replace Britain's current trains with new roomier, modern ones, will start operating in 2017, the department said.

Wednesday's deal is Hitachi's second train contract in Britain, following one for a line that connects London with Dover.

In addition to the trains, Hitachi will build several depots and upgrade a number of other depots throughout Britain for maintaining the trains, both sides said.

"A new train factory is fantastic news for Britain and will be welcomed by everyone who wants to see a thriving U.K. manufacturing sector," said Transport Secretary Justine Greening.

The new trains will connect London with cities to its west. Hitachi supplies the bullet-train in Japan, which has a high reputation for its railways. The contracts in Britain are Hitachi's first overseas.

Like other Japanese technology companies, Hitachi has been trying to reshape its operations to improve profitability. Hitachi returned to the black over the last two fiscal years after four straight years of losses.

"This represents an extremely important step on Hitachi's path toward global growth," said Hitachi President Hiroaki Nakanishi.

[Associated Press]

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